“How to Save on Car Insurance: 5 Key Discounts”

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Discover Auto Insurance Discounts with O1ne Mortgage

The cost of auto insurance can significantly impact your monthly budget. However, insurance companies offer various discounts that can help you save. Here are five types of auto insurance discounts you should know about, along with tips on how insurance companies set your rate and other ways to save.

1. Vehicle-Based Discounts

New Car Discount: New or newer vehicles may qualify for discounts. For example, Geico reports that new car drivers can save an average of 15%.

Anti-Theft or Safety Device Discounts: Factory-installed safety and anti-theft equipment, such as anti-lock brakes, airbags, alarms, and tracking systems, can earn you discounts. Esurance notes that such devices can save you between 2% to 25% on certain coverages.

2. Payment-Related Discounts

Discounts may be available if you pay your annual premium upfront, enable automatic payments, or go paperless. For instance, USAA customers who use automatic payments can save up to 3%.

3. Purchase-Related Discounts

Online Discount: Save money by shopping for insurance online instead of contacting an agent. Progressive offers an average discount of 7% for starting your quote online and another 9% for accepting and signing documents online.

Bundling Discount: Purchasing multiple policies from one insurer (or bundling) is a popular way to save. Progressive states that new customers save an average of $1,000 annually by bundling home and auto insurance.

Multi-Car Discount: Insuring multiple cars with one company typically garners a discount.

Loyalty Discount: Many insurance companies offer discounts for maintaining continuous coverage through them. However, some states, including Ohio and Maryland, may not allow loyalty to be factored into calculating premiums.

4. Driving-Based Discounts

Safe Driver Discount: Good drivers are less likely to file claims, so many companies reduce premiums if you go a certain number of years without accidents or moving violations. Geico offers discounts of up to 22% for five years accident-free.

Driver’s Education Discounts: Teenagers and seniors may get discounts by taking safe driving classes.

Driver Tracking Discounts: Using the insurer’s safety apps or in-car devices to monitor your driving can reduce premiums. Nationwide customers using the SmartRide app get 10% off when they sign up and can save up to 40% when their policy renews.

Low Mileage Discounts: Driving under 10,000 or 12,000 miles a year can lower premiums. Some companies even offer pay-per-mile auto insurance, charging a base premium monthly, plus a charge for each additional mile.

5. Demographic-Based Discounts

Affiliation Discount: Car insurance companies often offer discounts for members of organizations, such as fraternities, alumni associations, employees at certain companies, or military service members. For example, Geico offers qualifying active or retired federal employees up to 12% off.

Homeowner Discount: Buying a home demonstrates financial stability that can earn a discount. Progressive offers an average 10% discount even if your home isn’t insured with them.

Senior Discount: Many insurance companies discount your insurance at age 55, when drivers tend to be more cautious. (After age 70, premiums generally rise.)

Student Discount: High school and college students with good grades can save. State Farm says good grades earn discounts up to 25%. Being away at school and not driving can also get discounts. For example, at State Farm, students under 25 living over 100 miles from home without a vehicle are eligible for a discount.

Insurers may not offer the same discounts in all states. While some discounts are automatically included in your quote, others you’ll have to ask for.

Frequently Asked Questions

What Determines the Cost of Car Insurance?

Several factors determine the cost of car insurance, including your driving record, the type of car you drive, your location, and your credit score.

How Can I Save More Money on Car Insurance?

Besides seeking out discounts, shopping around can help you find the policy that best meets your coverage needs at the best price.

Can I Negotiate My Car Insurance Rates?

While you can’t typically negotiate rates, you can ask about available discounts and shop around for better rates.

Can Good Credit Help You Save on Car Insurance?

Yes, maintaining good credit can help you secure lower insurance premiums.

The Bottom Line

Beyond seeking out discounts you qualify for, shopping around can help you ensure you’re finding the policy that best meets your coverage needs at the best price. You can use Experian’s auto insurance comparison tool to help you find the lowest rates.

For any mortgage service needs, call O1ne Mortgage at 213-732-3074. We’re here to help you find the best solutions for your financial needs.

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